The elusive quest for growth

A while back I made a note to do a brief review of Bill Easterly’s The Elusive Quest for Growth after finishing reading it. I’ve not got round to it, but here goes.

It’s quite a good book but it’s also fairly quirky and peculiar. It’s nicely arranged into major parts each with one or more chapters with an “Intermezzo” at the end of each chapter, which just tells a story often from the author’s travels. The intermezzos are not heavily didactic, but rather just tell stories.

The first half of the book is highly didactic and fairly convincing in its demolition of one development panacea after another, from aid for fixed investment to debt forgiveness to cash for condoms. In each case Easterly shows with unsurprising mastery of the facts and the literature (a mastery that appears superior to his adversary Jeff Sachs) how naive these developmental panaceas have been.

I expected to find in Easterly a fairly ideological right wing tone, but didn’t find it. Easterly stresses the importance of poverty traps and the various costs of inequality of distribution. He really does come across as Ken Ringle (Washington Post) writes in his ‘shout’ on the back cover as “a lifetime idealist mugged at last by reality”.

After the anti-panacea chapters there are some good chapters on various topics which I guess are unified by the theme – things that can go right and wrong. The best chapter I thought was “Under an evil star” which is about luck. It’s quite sobering as he admits that almost all of the evidence he’s used about successes and failure might be more driven by luck than anything else.

So why is the book peculiar? It leaves two topics almost entirely alone. Both are big topics. The first is health. The second is the answer to this question. “So you’re so smart, Mr Easterly, what would you do?”

Easterly is not preaching despair, or if he is, he’s not saying we shouldn’t try to help with foreign aid. He’s just arguing that what we can achieve is much more limited than we have previously thought – at least in some countries. In fact in an article since he’s published his book, Easterly has been more forthcoming about his approach to what we should do if not very expansive as to what specific policies he’d follow.

I thought his reference to Karl Popper’s argument for policy interventions to be ‘piecemeal’ and iterative based on experience rather than grandly planned sounded sensible. But his book? Well, though sensible suggestions are summarily proposed or implied in some of the criticisms of existing policy throughout the book, he leaves it until a page and a half to go in the last thin concluding chapter of the book to observe “The solutions are a lot more difficult to describe than the problems”.

(And for Rafe’s benefit, in addition to invoking Popper (though not in the book) he does mention P.T. Bauer’s early warning of the failures of development.)

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Rafe Champion
15 years ago

Thanks Nicholas,
this is a link to Bauer

and this is a summary of the argument for piecemeal versus utopian reform.

Andrew Leigh
15 years ago

Makes a very nice counterpoint to Sachs’ latest. They’re both excellent advocates for quite different ideas. The only problem from a pedagogical standpoint is that he doesn’t have a neat summary chapter – so one either has to set the whole book, or none at all.